Special report: Emails show Shumlin administration down to the wire on single-payer financing

Gov. Peter Shumlin and his team say they will release their single-payer financing plan by Dec. 30, but as of last week, the Department of Health Reform was still running numbers.

The Shumlin administration continues to explore different economic scenarios, examining the results, and if they’re unsatisfactory, the state will tweak the inputs and start again.

State officials are using the Gruber Microsimulation Model. Robin Lunge, director of health reform, says the model offers Vermont “the best estimate that anyone is able to do” of how people and businesses will respond to a single-payer program.

MIT economics professor Jonathan Gruber is a consultant on Vermont's examination of a publicly financed health care system. Courtesy photo

MIT economics professor Jonathan Gruber is a consultant on Vermont’s examination of a publicly financed health care system. Courtesy photo

But internal documents, originally obtained by the Times Argus, indicate that the financing plan may still need work after it is released. Some 2,300 pages of emails between MIT professor Jonathan Gruber and state officials show that the financing plan may need to be adjusted after it is presented to lawmakers and the public at the end of the month.

In addition, the emails highlight a potential conflict of interest between a contractor and the state, shed insight into how the Shumlin administration is using executive privilege to shield decisions from public view and show that a 2017 launch date for implementation of single payer is in doubt.

The latest revelations come on the heels of an erosion of public faith in Gruber. Last month national news reports put a spotlight on impolitic remarks he made in 2013. Gruber told an audience at the University of Pennsylvania that the Affordable Care Act was enacted because people were kept in the dark. “A lack of transparency is a huge political advantage,” Gruber said. “Call it the stupidity of the American voter, or whatever, but basically that was really, really critical to getting the thing to pass.”

Shortly afterward, the state of North Carolina canceled its contract with Gruber. Soon after, the state of Vermont insisted that Gruber forgo $120,000 in remaining payments toward his $400,000 contract. VTDigger obtained copies of invoices from Gruber that showed insufficient billing detail for the payments he has received.

Last week Gruber apologized in testimony before the U.S. House Oversight Committee saying his remarks were “inexcusable.” Republicans in Congress, however, were not satisfied by Gruber’s apparent remorse. Rep. Darrell Issa, R-Calif., subpoenaed documents related to Gruber’s contracts with the Obama administration and states he has done business with, according to Bloomberg News and The Hill. The subpoena includes a demand for all documents and communications regarding state contracts. Doug Hoffer, the Vermont state auditor, has requested detailed information about the scope of Gruber’s work in Vermont and the names of his student subcontractors. None of that information is included in the invoices Gruber submitted to the state of Vermont.

Lunge says Gruber submitted rounded numbers of hours because he and his programmers worked more hours than the contract would pay for.

Once the gold standard

Gruber’s software is the gold standard for modeling health policy. It has been used by the Commonwealth Fund, the California Health Fund, AFL-CIO, Blue Cross Blue Shield Association, Robert Wood Johnson Foundation and the Small Business Majority among others, according to documents filed with the state of Vermont.

Gruber developed his model in 1999 for the Kaiser Family Foundation, a California-based health policy think tank.

Peter Shumlin signed the historic health care reform act on the Statehouse steps on Thursday. VTD/Taylor Dobbs.

Gov. Peter Shumlin signs the historic health care reform act on the Statehouse steps in May 2011. VTDigger file photo

By the mid-2000s, Gruber had begun to model health policy for states including California, Connecticut, Delaware, Kansas, Michigan, Oregon, Wisconsin and Wyoming. Scott Leitz, CEO of Minnesota’s ACA exchange, called Gruber’s work for his state “irreplaceable” in a letter of reference.

In 2006 Gruber worked with then-Massachusetts Gov. Mitt Romney to model and then implement Massachusetts Health Connector, a precursor to the Affordable Care Act, which has helped the Bay State achieve near universal coverage.

The modeling relies on assumptions and Gruber’s work underestimated the number of people who would seek subsidized coverage. Massachusetts had to raise taxes as well as co-pays and premiums to cover the shortfall.

When Vermont hired Gruber in July the model had been used by 10 other states to gauge the impact of health policies. Gruber’s economic model was also used by Congress and the Obama administration to shed insight into the impact of Affordable Care Act reforms on the economy.

Gruber’s model has improved with use over the past eight years, according to Lunge. Vermont gave Gruber’s model the best chance for success by loading it with state-specific data, instead of relying on national data, she said.

Art Woolf, economics professor at the University of Vermont. Photo by Hilary Niles/VTDigger

Art Woolf, economics professor at the University of Vermont. Photo by Hilary Niles/VTDigger

University of Vermont economist Art Woolf says economic models have their limitations. Modeling is at its best when tracking incremental changes, and breaks down when trying to predict behavior or rapid structural change.

“Whatever numbers they come up with are subject to a very large margin of error,” he said, suggesting that margin could be as high as 20 to 30 percent.

Lunge said she’s not sure “margin of error” is the right statistical construct, but she said some measure would be used to judge the precision of the state’s health reform modeling.

A crucial data point missing

Gruber is using data from a 2012 business behavior survey by Wakely Consulting as well a number of national data sources and previous Department of Labor employer surveys for his modeling forecast that will be presented at the end of the month.

A newer survey that would have provided up-to-date information about potential employer behavior under a single payer plan has been delayed. New survey results from the University of Massachusetts and Wakely Consulting won’t be available until January, after the governor has made his initial pitch to lawmakers on how single-payer should be financed, according to Lunge. The survey got bogged down in deliberations about what questions to ask and how, the emails show.

Lunge downplayed the survey’s significance saying, “I wouldn’t call it a limitation, as much as certainly something we’d want to look at when it’s done and compare it to the assumptions in the model.”

Shumlin’s proposal will be a “starting point” for a debate in the Legislature about how best to pay for the $2 billion program, Lunge says. She says she anticipates a “fluid” legislative process.

If the new employer survey results conflict with the assumptions Gruber uses, then they will be used to recalibrate Gruber’s model and the impact on policy decisions will be re-examined, she said.

In one early email exchange from July 11, Gruber asks if funding could be provided to conduct a survey of Vermont employers.

He writes, “the key behavioral assumption for the model is how many firms will still offer insurance under [Green Mountain Care],” and that “any assumption I make here will be largely guesswork.”

Michael Costa, deputy director of health care reform. File Photo by Hilary Niles/VTDigger.org

Michael Costa, deputy director of health care reform. Photo by Hilary Niles/VTDigger

Michael Costa, deputy director of Health Reform and the project’s tax expert, told Gruber that a group from the University of Massachusetts and Wakely Consulting were already under contract to survey employers. State officials eventually chose to postpone the survey, because the Department of Labor had another survey in the field by the time it was ready, according to Lunge.

No pressure to launch GMC in ‘17?

Shumlin has said frequently that he won’t press forward with single payer until the program is ready.

He would like to begin the state’s transition to Green Mountain Care in 2017, but Vermont’s experience with its exchange has made him wary of planning around a certain date, the governor has said.

Costa puts a finer point on that sentiment in an email to Gruber.

“We have a good relationship with the feds, and we are meeting regularly. Yet, they sometimes struggle to understand exactly what Vermont is doing,” he writes.

“We list 2017, but the exact rollout date is whenever we’re damn well ready given the rocky rollout of VHC and healthcare.gov. The real deadline pressure we feel is to secure a waiver prior to the end of the Obama administration,” he adds.

Costa is referring to a federal waiver to the ACA, which states can’t receive until at least 2017. Shumlin’s health reforms are contingent on the waiver, so ACA subsidies can be used to pay for Green Mountain Care.

“I wouldn’t say there’s no pressure to (launch in 2017),” Lunge said clarifying Costa’s apparently off-the-cuff email comments.

“People want to know the timing and have certainty,” she said.

But Lunge reiterated that Vermont’s experience implementing its still glitch-ridden exchange has made the administration wary of setting deadlines.

“We need to be realistic about timing, but that doesn’t mean there is no pressure. You’ll recall the governor wanted to do this in 2014,” she said, referring to Shumlin’s desire to bypass an exchange altogether and move straight to single-payer.

Privileged to make history

Gruber is a single-payer enthusiast, and he was open about his support for the plan from the beginning of his relationship with the state.

“I think we have the chance to make history here,” Gruber writes in one email.

State officials reined in Gruber’s zeal early on, telling him they could not send him details about the plan before they had a signed contract, otherwise it might not be considered privileged information later on.

“We tend to be cautious,” explained Costa.

Shumlin has kept the development of the financing plan for single-payer a secret. He has refused to release any information about the plan and has defended his use of executive privilege, arguing that he needs space to make difficult decisions before going public with a final product.

State officials insisted on language in Gruber’s contract stating he “may advise the Governor on policy matters related to the project,” with the express intent of blocking access to certain information about his work through public records requests, according to a July 11 email.

Robin Lunge, director of Health Care Reform for the Shumlin administration, speaks at a Vermont Health Connect forum in Montpelier last month. Photo by Roger Crowley/for VTDigger

Robin Lunge, director of health care reform. Photo by Roger Crowley/for VTDigger

Republicans and others calling for Gruber to be fired for his comments at the University of Pennsylvania, seized on a section of Gruber’s contract to argue that Shumlin’s plan would be compromised by his policy input. The governor, meanwhile, rebutted that charge and has said he wasn’t getting policy advice from Gruber.

Lunge maintains that the executive privilege exemption from the Public Records Act still applies because Gruber handles sensitive policy information from the Shumlin administration in order to model potential systems.

“Governors have to have the ability to develop really difficult policy initiatives, and as they develop those policy initiatives, to get it right,” Shumlin said this week after a judge ruled he would not have to release documents to a state rep whose public records request he denied.

“If you can’t have the ability to do that, it’s going to be very hard going forward to do big and bold things in Vermont,” Shumlin added.

Critics and even some of his supporters have argued that Shumlin is losing support for his signature policy initiative by operating in secrecy and not being inclusive in its development.

That’s something he has pledged will change once his proposal is “ready for prime time,” a claim that is undermined by his administration’s concurrently held position that the proposal is just “a starting point.”

Flouting a potential conflict?

In one email, Costa introduced Gruber to Anya Rader Wallack, a paid consultant for Vermont coordinating a $45 million grant to help the state change how health services are delivered and hospitals and doctors get paid.

Anya Rader Wallack

Anya Rader Wallack speaking to reporters in September 2011. VTDigger file photo

Her work is the other half of Shumlin’s reform program, which entails creating a leaner health care system he hopes will eventually be financed largely by Green Mountain Care.

In his introduction, Costa summarizes Wallack’s resume, writing that “She helped pass Act 48 and served as the first chair of the Green Mountain Care Board.”

“Now, she serves as a paid consultant to the SIM project and Dartmouth-Hitchcock. Also, she remains highly influential with the Green Mountain Care Board and remains a player within the Administration,” he continues.

The SIM grant has been part of the development of accountable care organizations in Vermont as well as the saving programs offered to them through the state’s Medicaid program.

Dartmouth-Hitchcock Medical Center gets many of its patients from Vermont, and is a member of the state’s largest ACO, OneCare Vermont. The hospital stands to benefit financially if OneCare’s members realize savings through the program Wallack helped design.

At the time she revealed she was considering a consulting job with Dartmouth-Hitchcock she told VTDigger, “I don’t think anything I’ve done in the past has had any clear advantage for Dartmouth-Hitchcock.”

“I don’t think I’ve had any conflict in the past, and I’ve made clear that if I have any conflict in the future I’ll recuse myself,” she added.

Morgan True

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  • Scott Woodward

    Yet more excellent reporting. No matter when Green Mountain Care is rolled out, I worry that there’s an attitude in Montpelier that supports the notion that it’s okay to create a Hobson’s Choice for both individuals and employers, rendering meaningless an important provision within Act 48. Section 1827(b) of Act 48, the section that speaks to enrollment, makes the choice of participating in GMC completely optional:

    “Nothing in this subchapter shall require an individual with health coverage other than Green Mountain Care to terminate that coverage.”

    Given the legitimate concerns about GMC, I wonder whether the administration’s financing plan will be balanced or whether it will penalize (by imposing hefty financial burdens) those Vermonters who choose to retain their ACA coverage if it turns out GMC does not live up to the hype. It wouldn’t be fair to make someone pay for both GMC and ACA coverage and for some people that would more than double their existing health care coverage. According to the Deerfield Valley News this November, “[Robin] Lunge made it clear that the law does not require Vermonters to use GMC, but it is an option all Vermonters should weigh.” I hope she really means it and that these are not empty words.

  • Dave Bellini

    The administration is working overtime to keep everything a secret. They don’t trust the public. How could the public trust them?

    • Chrissy Martel

      We can’t, which is why I still hold out hope they shake things up by appointing Milne.

  • Wendy Wilton

    If the margin of error could be as high as 20-30% that’s a real problem. There doesn’t appear to be a plan to create a significant reserve to offset a shortfall.

    If the estimates of costs vs. revenues are off by 10% that’s $600 million shortfall the entire Green Mountain Care fund and will wipe out any reserves in the health care fund and the rainy day funds of the state. Unless the Feds are willing to plug the shortfall every year it will require massive taxes well beyond the scenario that was leaked last week.

    • “If the margin of error could be as high as 20-30% that’s a real problem. There doesn’t appear to be a plan to create a significant reserve to offset a shortfall.”

      Wendy, I agree that is a huge margin of error. I think the weather forecasters have more accurate models, and they at least use a variety of models to produce a blend… no such option here. Something for concern for all of us.

  • ray giroux

    It seems to me that this should be phased in slowly. The people of Vermont really should have more input. The fact that the “secrecy” is needed is of huge concern.

    It’s like needing a ride, there is a ride available but, you have to get on the ride while it is going 60 MPH. Some may make it and some may not.

    What would be a good starting point?

    So far, the whole healthcare debacle has failed because it was made Law without having a plan. The State (Shumlin) jumped in with both feet without testing the waters, without knowing one thing about where the money would come from. It has no structure. It’s like a building with no foundation, destined to crumble upon occupancy.

    So, why not start small, test the waters and build from a foundation based on experiences from a small working model?

    It is more about Peter than it is about Vermonters getting affordable healthcare. His ticket to DC.

    • Dart Everett

      Ray,
      One correction to your comment. You say “the people of Vermont should have more input.” From what I have observed, we have had no input. Shumlin is playing the Obama script which Nancy Pelosi accurately described as “we’ll know what’s in it after we pass it.”
      What astonishes me is that the news media in the state has allowed this secrecy to go on with barely a peep. So much for Freedom of the Press and Open Government. The liberal “newsfolks” in this state, and the nation for that matter, are mesmerized by the idea of single-payer and don’t care about process or the truth of how it will be paid for. The Machiavellian “ends justifies the means” certainly applies. Shumlin and Obama, abetted by their respective Democrat-controlled legislatures have jammed through partisan ideological legislation without proper analysis of its impact. So called
      “affordable health care” to reduce costs and improve health care will do neither. The reduced premiums will be subsidized by taxes. I am on Medicare and am fine with it (no major medical issues yet for me to have had to test it), but I realize the nearly 50 years I have paid into it don’t really support what I cost. That’s borne by those of us still working and paying it.
      And, costs have certainly not gone down, although some insurance premiums may have because of subsidies.
      Quality will surely decline as fewer doctors have to see more patients, and research to improve technology and drugs are starved of their profits, a dirty word to the progressive community.
      The fact is that Shumlin has been and continues to be as dishonest with Vermonters as Obama is with the nation.

  • James Rude

    We are all going to be deluged with data spin on this issue to support whatever side you hope will ultimate prevail. We are going to be hit with estimates of cost, benefit designs and suggested taxing mechanisms that will greatly impact every Vermonter. So far, how any of these proposed changes impact my wife and I, both who are on fixed incomes and social security, are unknown, yet have a potential cost to us either in the form of increased income taxes, limits on supplemental insurance options, etc. All of this uncertainty was given birth off of vaguely written Act passed by the Vermont legislature some time ago.

    Now is the time to get real. The public should be afforded the option to vote on a well thought out proposal rather than a slogan. The only way to resolve this debate is allow the Governor and his staff lay out all of the components of the single-payer program, completely articulated and proposed in detail, including the financing mechanisms, tax increases that would be paid by business and individuals, benefit structures, etc. Then, once fully fleshed out, hold a special referendum vote for all Vermonter to weigh in on. A simple “yes” or “no” vote based on a fully informed electorate is what is needed. Currently, all we are doing is chasing after guesses and innuendo. Having our legislators vote “yes” to highly complex and vague piece of legislation, as was done with Act 48, without understand the consequences on individual choice and cost was a foolish errand. Let the public knowingly vote on something substantial.

  • Ann Raynolds

    Well, some may like their insurance on the Exchanges, but I have met many who either cannot afford the high deductible plans or have simply opted out in favor of free clinics or stand-alone Medical clinics popping up all over for pay-as-you-go everyday medical problems. My “microsimulator” — ie., Vermonters I talk with, are sick and tired of health care constantly being talked of in economic terms. I hope there is a March on Montpelier for Health Care as a Human Right. Sad thing is that too many planners have excellent Insurance coverage and do not feel the pain.

  • Richard Ratico

    Ray,

    “It is more about Peter than it is about Vermonters getting affordable healthcare. His ticket to DC.”

    If this is true about Peter Shumlin, it is doubly true about his opponents.
    The governor’s critics realize he has a huge incentive to get single payer “right”. He may. Is that not their greatest fear?

    A win for single payer and Vermont is a huge loss for republicans. Taking their cues from Mitch McConnell, they put their party’s ambitions before those of Vermonters.

    • Glenn Thompson

      Richard Ratico,

      “A win for single payer and Vermont is a huge loss for republicans.”

      And if it is learned Single Payer will not work and gets scrapped….who will that be a huge loss for?

      There is a reason why the GOP took over control of the US senate. Added more members to the US house of Reps. Added a couple more governorships, and added to majorities in state legislatures….and the final one….Shumlin came close to getting tossed out of office!

      You don’t suppose it could be partial due to the Democrat’s reckless attempts at ‘Social Experimentation’ without a clue what they are doing?

    • Richard Ratico

      Glenn,

      We’ll know about single payer soon enough. I’ve got too little time today to bat this ball back and forth. So you’ll get to have the last word.

      Efforts on behalf of single payer may well succeed. The ACA already does. Grudgingly recognizing that, the right wing finally let go of that bone to focus on …. Benghazi? By the time they’re done with the last Benghazi committee they’ll probably have wasted more of our time and money than they did on 54 votes against Obamacare.

      The last time the party of no was in power, what did we get? Wars, deficits & Dick Cheney.

      Your comment only put an exclamation point on mine. Thanks.

  • Cynthia Browning

    In the first part of the article it says that the administration continues “to explore different economic scenarios, examine results, and if not satisfactory, tweak the inputs and start again.” I would be interested to know how ‘satisfactory’ is defined. Does that mean that they are only interested in results that make GMC/single payer look good?

    I am very concerned that we will only see the successful results, the ‘satisfactory’ results that make the proposal look feasible. That is not a safe basis for a long term program.

    I know that the Legislature has retained a consultant to evaluate Gruber’s work. I hope that he/she actually gets ALL the results, so that we can have some confidence that someone has looked at the worst case scenario who wasn’t already ideologically committed to GMC/single payer. Will this legislative consultant have access to the material that is currently hidden under the umbrella of executive privilege?

    Rep. Cynthia Browning, Arlington

    • Lance Hagen

      Ms. Browning,

      It is extremely important in any modeling exercise to know what was used for input parameters and understand the confidence level that exists for each parameter. It is also important to run ‘sensitivity studies’ on these input parameters, so that if there is an error in an input parameter the impact on the end results are known.

      I think the legislature needs to demand this type of analysis from the administration.

  • What many seem to forget that this is a work in progress, that No Other state has tried to have single payer health care before. Many of the critics should not expect a “perfect plan” to somehow emerge full blown immediately. Most likely even when single payer is in place it will require some modifications.

    In some cases, those individuals or organizations who are against single payer due to ideological or self-interest business reasons will probably never endorse even a “perfect plan.”

    In general, I think there is a fear that if such a plan is adopted in Vermont, it will become so popular that other states will want to follow the example.

    • Lance Hagen

      If this really was a ‘work in progress’, these is no way we should have waited 2 years for a ‘plan’.

      Your comment elevates my concerned that we will not see much on ‘plan’ details at the end of the month.

    • Kathy Callaghan

      Jerry, it is not supposed to be a work in progress. At this point after missing multiple deadlines since 2013, legal and otherwise, the Governor owes Vermonters a fully vetted final report. This is getting more than ridiculous.

      Many Vermonters are not wedded to any ideological self-interest. They simply want to avoid being on the Titanic when it goes down. Basic common sense is what we Vermonters pride ourselves in, and the single payer plan doesn’t pass that test.

      Much of the math is already known. There are no real mysteries left except the benefit levels, which predictably will be less than most Vermonters have now. As Sen. Tim Ashe recently stated, it’s time to get on with the work of providing good coverage to all Vermonters in a sustainable way. That is what the Legislature should be working on this session.

  • ray giroux

    2 years and over $100, 000, 000 should have something going. For that much money people should be getting something, unless of course we are being treated as Customers.

    We are “the people of Vermont” the Government has taken our money and have failed to produce a working program.

    They work for us, please do not lose sight of that. We are the “People” and they are there to serve US.

    We are getting this shoved down our throats like we are Patients or Customers and that does not bode well. The power has been tipped upside down and most are cheering for it, the Progressive Utopian Dream. A totally centralized power of Government over our lives.

    One of the post above has it right, we should all show up in Montpelier and demand better service from our Legislators.

  • Darcie Johnston

    There is no doubt that the well-funded single payer groups and Governor Shumlin would like to see VHCF go away. But we cannot – and, with your help, we will not.

    VHCF is the sole voice of public dissention – in a sea of single payer government-run health care advocates. We represent folks like you, who have not “drunk the Kool-Aid”. No other Vermont organization is dedicated solely to this work. There are many well-funded groups on the other side, spending a lot of money to bring about single payer. But VHCF receives no funding from the big-money groups. We are a grass-roots organization that relies completely on supporter donations to remain in business.

    We are grateful for the support we have received, but without continuing support from grassroots Vermonters, we cannot continue to be effective at preventing Governor Shumlin and his like-minded friends from implementing a single payer health plan by 2017.

    Please take a moment now to give generously, by going to http://www.vthealthcarefreedom.org or sending a contribution to: Vermonters for Health Care Freedom, PO Box 1515, Montpelier, VT 05601.

    Thank you.

    Sincerely,

    Darcie L. Johnston
    Founder, VHCF

  • Dan Carver

    Jerry,

    The “fear” from single-payer opponents is having swindle-payer implemented, then finding out the tweaking was wrong. Then the State will turn to the 30% of our middle class that pays the bulk of the income and property taxes to squeeze more money out of us to support “the majority.”
    Gruber was absolutely right, “A lack of transparency is a huge political advantage,” Gruber said. “Call it the stupidity of the American voter, or whatever, but basically that was really, really critical to getting the thing to pass.”
    Everyone on the single-payer band wagon doesn’t seem to see the connection between what Gruber comment in 2013 and the on-going debate on this website; those that want to see and understand the details and those whom Governor Shumlin wants to thank for their blind support!
    Thank you.

    • Dan, I am not looking to blindly stumble into single payer (VT style), and I am not willing to blindly reject single payer.

      I do start from preferring a single payer system, but I too want to see the details prior to implementation. If those details don’t work so be it – let’s explore other avenues.

      Gruber was correct about the lack of transparency being good for passing the ACA which in the end was a multiple payer, for profit insurance corporation system – NOT single payer. A lack of transparency has not been and is not good for Vermont’s version of single payer.

      I’m not going to draw any final conclusions without seeing the details. I also find myself in agreement with a great many others.

      • James Rude

        Rama, my point in my early post is that if we don’t like what the details of this plan produce, for example, higher taxes than what we expected, a lackluster benefit plan, etc., then what are we a taxpayers to do? I say bring it back for a vote of the people once the details are known.

    • Walter Carpenter

      “The “fear” from single-payer opponents is having swindle-payer implemented, then finding out the tweaking was wrong.”

      Dan, is this really our fear? Our fear is that it will not go far enough, that we will continue to be swindled by a system design to exploit our need for health care for the profit of a few.

  • John Elliot

    Imagine where we might be now if the financing was figured out before the single payer law was passed. That would have been the sensible thing to do. But now, three and a half years later we are still guessing whether or not Vermont can afford its single payer health care system.

  • Marguerite Mason

    I’m sorry to interrupt a stimulating discussion, but does anyone know where to go for information on how Single Payer will affect Vermonters on Medicare?

    • Jill Charbonneau

      While I have not been as active as in the past on Green Mountain Care issues, it was my understanding Medicare recipients level of care would not be negatively impacted. They may even see benefits rise if the Green Mountain Care plan has more generous benefits than Medicare.
      Medicare and private insurance billing is one of the features of Green Mountain Care. A person with federal health care benefits would receive treatment as any other patient but the federal plan would be billed for the service. Mark Larsen likened it to having a library card entitling a person to use the local library. A Green Mountain Care card will entitle a patient to service.
      The Vermont Department of Health should be able to answer your questions.

  • Joyce Wilson

    Marguerite, Morgan True had a good article that the discussed the possible funding of Vermonters on Medicare. If Vermonters are working and on Medicare, I assume that they would also pay the payroll tax. The possible 8% payroll tax for Vermont’s single payer only brings in approximately one half of the tax dollars needed to fund single payer.

    “It’s likely those options will involve a higher or lower payroll tax with a corresponding fee or premium.

    It’s also likely that the fee will be reduced for people over 65 who are Medicare eligible and will only use Green Mountain Care, as the publicly funded program is known, for secondary coverage….

    The outline sketched by sources does not differ greatly from what outgoing Sen. Peter Galbraith, D-Windham, laid out last spring, in what he called the administration’s “notional financing plan.” He attributed that plan to sources within the administration.

    At the time, Galbraith said Green Mountain Care would be financed through a premium graduated according to income, which would hit a ceiling of 9 percent for people with incomes of $50,000 or more.

    The premium would generate about $1 billion, according a calculation by Galbraith. Combined with an 8 percent payroll tax, that would create revenue streams of close to $2 billion.”

    http://vtdigger.wpengine.com/2014/12/04/single-payer-financing-likely-start-8-percent-payroll-tax/

    • James Rude

      Income as defined only through payroll, or income from all sources such as from investment, including social security income? For those of us who are retired and live off of social security and savings, this is an important distinction.

      • Joyce Wilson

        James, The possible 8% payroll tax component is only half of the taxation needed to fund Vermont’s single payer. The other half or component is suggested to be an income sensitive fee or income tax that all income would be subject to, of course if a certain income.

        The possibility would be to have a reduced income taxation on Medicare patients since you can only use single payer as your secondary coverage in state. Would the taxation be 5%, 6% on Medicare patients? It appears that Medicare patients will have some taxation to pay for single payer.

        Also please see my response to Glenn as you still will your Medicare supplemental insurance in addition to the single payer taxation or at least I would not want to be without it.

        Do not miss the excellent reporting done by Morgan True in the link that I posted above if you have not read it.

    • Glenn Thompson

      Joyce Wilson,

      “It’s also likely that the fee will be reduced for people over 65 who are Medicare eligible and will only use Green Mountain Care, as the publicly funded program is known, for secondary coverage….”

      Joyce, why would you believe Medicare supplement coverage rates would go down under a Single Payer system? Given what I have learned about Single Payer and the unknowns about how it will be paid for….I’d be shocked if rates went down!

      FYI, I just received a notice from BCBSVT that rates for Vermont Medigap Blue (Plan C) will rise 11.3% starting Jan 1, 2015. Which leads to my final question….which to date no one has properly answered! If Single Payer becomes reality, will those people 65 and older who are Medicare eligible have the option of choosing another Medicare Supplemental plan other than GMC?

      • Joyce Wilson

        Glenn, The “fee” is the income premium sensitive fee or the income tax component to fund Vermont’s single payer from the Vermont Digger article link that I posted above. The possible 8% payroll tax is only half of the taxation needed to fund single payer. The other half might be an 8% income sensitive fee or 8% income tax that even Medicare patients would have to pay. The suggestion in the VT Digger article that perhaps Medicare patients would pay a reduced fee. So please do not confuse the income sensitive premium fee or the income tax to fund Vermont’s single payer with your supplemental Medicare policy.

        You will still need your Medicare supplemental policy otherwise you would not have coverage when travel out of state other than your basic Medicare. Vermont’s single payer is based on a limited pot of dollars to be spent for the year so they can not to afford to pick up the supplemental coverage when folks are outside of Vermont.

        Your question” If Single Payer becomes reality, will those people 65 and older who are Medicare eligible have the option of choosing another Medicare Supplemental plan other than GMC?” You are offered Vermont’s single payer as your supplemental Medicare coverage so you will be taxed to pay for it. You will be still able and I say need to purchase a supplemental Medicare policy.

  • Linda Wysocki

    this single payer plan is redistribution of wealth under the guise of healthcare. Keep in mind, the more you pay in taxes, the less discretionary income you have and the less power and personal freedom you have. Wonder how many of the people saying healthcare is a right make $50,000 or more??? Easy to say you’re for it if you’re the one getting a subsidy. Vermont has an aging population and younger folks are leaving to find good paying jobs in other state.s Who will keep paying the healthcare bill when there are more takers than payers?

  • David Dempsey

    If single payer comes to fruition, it’s not going to be tomorrow. In the meantime many Vermonters are mandated to buy insurance through the exchange from BC/BS, which has a monopoly, with token competition from MVP. No competition leads to higher premiums as we have scene this year. People are getting late notices for premiums due that they already paid. Some who have insurance are denied care at the providers because the exchange administration is missing in action. The exchange is a mess, to put it mildly. If a privated insurance company provided this kind of service the legislature would be all over them demanding better service that Vermonters need. They should be all over the administration for failing all Vermonters. because the mandated health exchange is a inexcusable disservice to Vermonters. Milne has the best idea. Cut the losses on the health exchange by scrapping it and join the federal exchange. That would create competition and lower prices by offering more choices of insurers, and get rid of the mandate.

  • Walter Carpenter

    this single payer plan is redistribution of wealth under the guise of healthcare.

    A redistribution of wealth for who?

    And, perhaps there is a reason why those who are making less than $50,000 (to use your figure) are the saying that health care is a right. They are the ones (and I am included in this number) suffering the most under this capitalistic health care system. Not every one of them is getting the subsidies either. As for young people leaving the state, this has been happening in Vermont since the late 1700’s. For that matter, it has been happening in NH, Maine, and probably every other state for generations. It also ignores how young people are coming into Vermont to stay here.

    • Carl Werth

      Walter,

      Ignore the young people who are coming to stay?

      According to the most recent US census, Vermont, Maine and New Hampshire have highest (or oldest) median ages in the country. This more than clearly indicates that young people are LEAVING these states at much higher numbers than are moving in.

      Don’t just take my word for it – google the census data or please see this link for more information: http://www.pressherald.com/2013/06/16/maine-is-nations-oldest-state-and-getting-older/

  • What are the chances that the administration or Gruber releasing the model to third parties for validation?
    I would love to see the sensitivity analysis of the variables used in the model, if it was done.

  • Neil Johnson

    Early on the President made a very valid point, I believe he stated that over 50% of the states have a health insurance provider that has 80% or more of the business. In all states one insurance company had more than 50%. There is no cross state competition. They are all monopolies and they are more than likely owned by one holding company. There will be no reduction in health care if there is no competition. Where do you go if you have a problem with one payer health care, we can’t fight city hall, you’ll die before you get any results. Vermont is notorious for red tape on local zoning issues, not being able to hold in school costs how is this going to be better? There is no reason why health care couldn’t operate like car insurance. Easy fast and some basic coverage. The fact is that we need to afford something on an average families income. We can certainly spend more in a hospital visit than we can every earn in our lifetimes.

    The theory is that it’s supposed to be cheaper, but why isn’t that working? They should be proud to show us the numbers. If you are trying to run a monopoly on other peoples money (taxes from different sources) and/or stealing money then you certainly don’t want people to see the “hard” decisions they make.

    The hospital and doctors office is the only place I know if where they can’t tell you how much things cost. Doesn’t that seem a bit odd?

    We can’t decide in insurance companies that pay well, in the auto world, I’ve had unpleasant experiences. Cheap policy, not good coverage, tough to get settlement. So I went local…no problems since. With one payer where are you going to go when you have problems?

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